pattern can be arrived at by naked trading in another option. For example, the prot pattern from covered
call writing, involving a long stock and a written call, can be arrived at by writing a put.
is indicates that only one type of option exists. An investor can include a call option in their portfo-
lio or just as easily create the option position by investing in the underlying security and a put. Of course
the prots will vary for the two strategies, but they can be made equal by including risk-free securities.
is relationship between a call and a put is known as the put–call parity, which will be di ...
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